Majority shareholder question.?

"I use my bank to buy and sell and they charge a small fee for the trade."

You're not in the position to make threats in the market, then.

Also, if you're buying enough shares to liquidate it for the assets, odds are you would get a lesser return than you could usually. Much of the shares price is based on the expectation that the companies earnings and revenues and assets will grow; so selling it will give you the book value minue loss on sale of assets, whereas you'll lose the mark-to-market cost on shares.

Thats the way its done, if you believe the stock is under valued relative to the assets. But once you obtain five percent of the company that becomes public knowledge, because you have to notify the SEC, and the company could start throwing up all kinds of defenses. You may not even need a majority. Just buy enough and start making threats to the board. As long as other shareholders agree with you and management is weak. But it can be enormously risky and expensive. Carl Icahn did something similar with Kerr Magee. He bought 7.5 percent of the stock and threatened a proxy fight if they didnt buy back shares. The company caved and the buyback boosted his stake. They sold off assets like the chemical business and ended up selling the company to Anadarko Petroleum.

Well..you could certainly start the process...there are other considerations (i.e., when you reach a certain level of ownership, you have to announce when you are buying and selling, etc.). First, if folks figure out you are buying to sell the pieces, they will drive the stock price up to asset value (what the pieces are worth), which means you won't earn very much (you may even lose money if an asset is street valued more than you can sell it for).

The trick is to buy undervalued companies and rather than selling them off piece by piece, re-organize them, make them profitable and then sell them (the Warren Buffett method). And yes, if you do this, you can make a LOT of money (depending on what year it is and how the market is doing, Buffett is worth close to $50 billion and is one of the three richest men in the world).

Yes, if you are the majority owner you could do whatever you want including liquidate the company and sell its assets. If you could buy a company below its liquidation value (which is rare), you could do it. It's much harder in practice because of severence costs and trying to sell used assets which are on the books for cost rather than current value.